Your Right to Know

WASHINGTON — The Maryland company that wants to build a uranium-enrichment plant in southern
Ohio said yesterday that it will declare bankruptcy early next year.

The announcement comes as USEC Inc. approaches a Jan. 15 deadline for a two-year
research-and-development project aimed at convincing the federal government to continue to pay for
the commercialization of its enrichment project.

USEC argues that by cleaning up its balance sheet, it is creating a better environment as the
Department of Energy considers a path forward for the research program.

But company officials admit that the ongoing nuclear disaster in Fukushima, Japan, and a global
glut of enriched uranium have made it difficult to sell USEC’s new technology.

The company plans to file for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for
the District of Delaware in the first quarter of 2014. The bankruptcy filing would not halt the
research project in Piketon.

“This is not about liquidity,” said Paul Jacobson, a spokesman for USEC. “We have plenty of
money to run our business and so forth. This is about a large amount of debt taken on a few years
ago.”

In a news release, the company said it is restructuring to pay off about $530 million in debts
to bondholders. The bonds were scheduled to mature in October 2014. The current debt will be
replaced with new debt totaling $200 million. That debt would mature in five years.

Jacobson said the restructuring plan will reduce the debt and “put us on a stronger financial
footing.”

He said that when the company agreed to the $530 million in debt, it expected to have revenue
coming in by October 2014. But the disaster in Fukushima that began in March 2011, and technical
problems at the Piketon plant, have made the process longer than anticipated, he said.

“The revenue is just not coming in.”

For years, USEC had hoped that the federal government would sign a loan guarantee that would
allow the company to commercialize its technology. Company officials argue that USEC is the only
U.S.-owned company in the business of creating enriched uranium and that having domestically
produced uranium by a U.S.-owned company is vital for national security. The uranium would be used
primarily for nuclear power.

But the program has been met with skepticism from environmental and taxpayer groups.

The company recently touted a success in its long-troubled efforts to commercialize its
technology. The uranium-enrichment plant in Piketon, called the American Centrifuge Project, has
been successful in recent tests of its “cascade” of 120 machines. The company has met three
milestones required to receive Department of Energy support, which it needs to meet the
requirements of its creditors.

The Ohio congressional delegation sent a letter to Secretary of Energy Ernest Moniz this month
urging him to “provide a path forward” for the work in Piketon.

It was signed by every member of the congressional delegation except House Speaker John Boehner,
R-West Chester, who rarely signs letters because of his leadership position.

Sen. Sherrod Brown, D-Ohio, said he continues to support the project.

“I hope that by restructuring its finances, USEC can ensure the resources it needs to continue
to be a partner in the American Centrifuge Project,” Brown said, noting that the project could
create about 4,000 jobs.

Jacobson said the company is at a “critical time” and will need some “clarity” on what will
happen after Jan. 15. He said the company has spent $2.5 billion in the past decade modernizing its
technology, and should it abandon its work, the United States could face a crisis if it later needs
enriched uranium.

“Do you put it on a shelf and mothball it?” he said. “And when the time comes later, do you have
to spend another $2.5 billion?”